Cabinet okays more flexibility for state banks

Cabinet has approved a proposal to give greater flexibility to the boards of state-run banks in taking decisions to improve operations.

The cabinet on Thursday approved a proposal to give greater flexibility to the boards of state-run banks in taking decisions to improve operations.

State-run banks have long been seeking greater freedom from the government to match the efficiencies of their private-sector and foreign counterparts, who have eaten into their business since India embraced free market reforms in 1991.

"The Union cabinet today gave its approval for carrying out amendments (to banking laws), which will bring the operations of nationalised banks in tune with the changed scenario and modern business practices," cabinet spokesperson and Information and Broadcasting Minister Priyaranjan Dasmunshi told reporters late on Thursday.